Mindflair delivers 28% NAV growth and £1.64m profit in H1, driven by AI portfolio gains and key exits
() , an AI-focused tech investment company, announced its interim results for the six-month period to June 30, 2024 (H1 2024).
Mindflair reported a 28% increase in NAV to £7.49m as of June 30, 2024, compared to £5.84m on December 31, 2023. NAV per share was 2.70p, compared to a current share price of 0.775p. Profit also grew significantly during the half to £1.64m, compared to a loss of £512m for equivalent period last year.
Mindflair also noted a number of portfolio milestones during the period, most notably the disposal of Landvault (an investment in the SVV1 fund) to Infinite Reality for US$450m in an all-share deal. Additionally, executed a profitable sale of shareholding in Smarttech247.
Another large AI-focused investee of is Getvisibility, which continued to report good progress in H1. Post-period, cybersecurity leader Forcepoint launched a comprehensive security solution for Open AI GPT, powered by Getvisibility's core technology.
Nicholas Lee, Director of Mindflair, commenting: "The Company has made excellent progress in the first half of 2024 with a significant increase in net assets and further progress with regard to the realisation of investments in its portfolio. In particular, the sale of Landvault for US$450 million has been completed and SVV1 now holds shares in Infinite Reality. We expect to receive further details with regard to the planned IPO of this company shortly. There has also been an exciting further development announced regarding Getvisibility's relationship with Forcepoint in connection with data protection across generative AI."
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A strong performance by Mindflair in H1, with a 28% increase in NAV, bringing NAV/share to 2.70p. At a current share price of 0.775p, Mindflair is trading at a 71% discount to NAV, presenting an attractive opportunity for growth investors.
In our estimation, is presently undervalued, given the scope for material valuation uplift of the companies within its portfolio, evidenced by the abovementioned realisations and continued increase in NAV and profit. Continued projected growth of the AI sector, and progress reported so far across the SVV1, SVV2 and SVV3 funds through which invests, have bolstered investor confidence in the company's portfolio.
Mindflair's 23.8%-owned Sure Ventures, which runs the SVV funds, achieved significant portfolio milestones during the period, most notably the sale of Landvault to Infinite Reality in an all-share deal valued at US$450m. The sale could generate a significant uplift in the carrying value of SVV1's investment, with a realisation expected to follow as Landvault intends to list on Nasdaq in Q3 2024. Consequently, the move is expected to materially increase the valuation of Mindflair. The disposal has the potential to generate proceeds for Mindflair of c. US$6m, depending on the value of Infinite Reality shares, a c. 470% increase in SVV1's carry value of Landvault as of end of March 2024.
Post-period, Mindflair increased its stake in Sure Ventures and in turn the SVV1 fund, which was significantly bolstered by the sale of Landvault. The new subscription increased Mindflair's shareholding in Sure Ventures from 18% to 23.8%, which should in turn increase book profits and cash returns realised by in the short-to-medium term from further expected realisations in SVV1 (now in realisation phase), as well as increased exposure to the AI-heavy SVV2. Mindflair also raised £925k post-period, further bolstering its balance sheet.
shares jumped 25.1% in early trade on the positive H1 results.
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